“Mixed Order” Organization: Breaking the Dilemma of Innovators

In the VUCA era, top-down management and control has become obsolete, and bottom-up empowerment management is emerging. What is the future trend of empowering organization and management? This journal invites famous scholars in empowerment management, founder of the course creation community, and Professor Gao Song of East China University of Science and Technology, focusing on empowering agile organization construction, empowering business learning methodology and other fields, and bringing readers the latest research results and cutting-edge cases.
In traditional bureaucratic organizations, the parts of the work are meticulous, the tasks are standard, the process is clear, and the order is in order. It is like a sophisticated machine that cannot tolerate any mistakes. However, while the order culture produces high efficiency and low cost, it also abhors redundancy and failure, which suppresses organizational innovation and leads to the dilemma of large-scale organizational innovators.

How to solve this organizational problem, introduce a “hybrid” culture in an organization dominated by “order”, drive the organization’s rapid innovation, so as to achieve a mixed order combination, which can maintain the stability and efficiency of the organization’s original business, and achieve The agile adaptation and evolution of the organization to the environment. This article takes Autoliv China’s SWAT empowerment team organization reform practice as an example to discuss the construction of a mixed organization.

Autoliv (Autoliv) is the world’s largest supplier of automotive safety systems, with production and operation organizations in 27 countries around the world, with more than 60,000 employees. In 2019, the company’s total sales reached 8.5 billion U.S. dollars. Autoliv’s business in China began in 1989 and has established a regional headquarters, a technical center, and 14 production bases in China, with approximately 9,000 employees, and sales accounted for 18% of global sales. about.

Beginning in 2018, China’s auto market has entered a critical period of transformation. After nearly 10 years of rapid growth, it has begun to enter a stage of steady and micro-growth. At the same time, fueled by new energy and new technologies, the automotive industry will face tremendous changes.

As a supplier of automotive safety systems, Autoliv is a typical order-oriented enterprise. Autoliv’s rigorous standards and procedures are both a protection and a restraint. The standardization of large enterprises will gradually solidify the innovative thinking of some employees. The President of Autoliv China described: “Some employees are used to repeating the same trajectory every day, turning work into a habit, like a screw on a machine, making innovation a luxury.”

The underlying logic of agile evolution: chaotic balance
In fact, the problem Autoliv faces is a common dilemma faced by all bureaucratic organizations. Bureaucracy is the organizational paradigm proposed by Max Weber in the early 20th century. It is currently widely used in governments, enterprises and non-profit organizations. Bureaucratic organization emphasizes upper and lower levels, horizontal professional division of labor, and process-based collaboration. The entire organization is like a precision-running machine. Its biggest advantage is efficiency and cost. It is suitable for doing certain things correctly in a stable environment. However, the biggest problem with this organizational paradigm is that the pursuit of lean, cost, and certainty greatly damages the ability to innovate and adapt.

The direction of change is to introduce a “hybrid” culture in the organization. Innovation often occurs on the edge of chaos and order. If an organization can create a “hybrid” culture in a specific range, emphasizing a culture that embraces failure and encourages innovation, it can drive the organization to achieve innovation breakthroughs. However, only cultural introduction is not enough, but also requires organizational innovation.

Autoliv’s transformation started with the construction of the empowerment team SWAT.

In August 2018, Innovation SWAT was formally born under the joint initiative of the President of Autoliv China and the Vice President of Human Resources.

The name of SWAT comes from Special Weapons and Tactics (Special Weapons and Tactics), which is commonly known as special police/special forces. It was originally born in the United States. A team of 4 to 5 people is equipped with various cutting-edge weapons and equipment. The tactical process and super personal ability have been verified as the most effective combat combination after actual combat.

Autoliv’s SWAT also possesses the above-mentioned characteristics, and has burst out of powerful combat effectiveness. In two years, this 17-person SWAT team has created an output that is 20 times greater than the per capita performance, which has deeply affected Autoliv’s agile mechanism throughout the company.

The SWAT team makes bold breakthroughs and innovations in all aspects, such as materials, design, suppliers, manufacturing processes, and so on. They can be seen in every process link. New ideas are constantly emerging. In the process of trial and experimentation, there are many denials, but a few successful ideas have achieved fruitful results beyond everyone’s imagination (Figure 1).

Up to now, the SWAT team has achieved the following goals in stages: ① While reducing costs in a variety of ways, it has significantly enhanced the competitiveness of products; ② Product design improvements and new product development have been implemented on multiple projects and applied At different stages such as customer quotation and standard operating procedures; ③expanded a number of high-quality suppliers and gained recognition from customers; ④provided useful suggestions for the revision of standards.

The bureaucratic organization based on order is characterized by horizontal division of labor, with different functions undertaking standardized work, and then coordinated various functions through a rigorous process. The main problem is that the functional departments have their own KPIs, and the ass directs their heads. Just looking at problems from a narrow functional perspective will cause departmental walls and mutual wrangling, slow corporate reaction speed, and loss of overall interests.

Cross-functional integration is an extremely important feature that enables agile organizational change. Such as the Huawei Audio-Technica, the Handu Clothing and Shelves Group System, and the Yihai Kerry Empowerment Business Consortium, all have this characteristic. Autoliv’s SWAT is no exception.

Figure 1 Cross-functional integration is the key to innovation and agility

The task of Autoliv SWAT team is to reduce costs and increase efficiency, improve the competitiveness of enterprise products, and better serve customers. The SWAT team is two teams of 17 people divided into different product areas. From the two internal team leaders selected by self-recommendation and competitive recruitment, they recruited themselves and assembled into a package of product development, manufacturing technology, quality management, and procurement. A small team with different functions.

Traditional organizations form departments with the division of functions. The departments have their own specialties and responsibilities, but it is inevitable that there will be gaps in the cooperation and coordination of the departments. The SWAT team has effectively avoided the problem of departmental walls, small teams, centralized office, open and transparent information, and discussions at any time, making full use of the collective wisdom of cross-functionality. From division of labor, division to individual division of labor, give full play to personal cognition and creativity. And everyone is no longer confined to the deep well of the department, no longer sitting on the well, but forming a full-process, end-to-end overall vision and influence. Objectively speaking, the SWAT team has more opportunities to discover market opportunities, organizational blind spots, failures and wastes, and apply patches and make corrections at the same time as the organization and business diagnosis.

For example, in the purchase of a product, there was originally only one design structure and only one supplier was used, so the supplier’s price was relatively high. The situation at that time was that the cost reduction that could be achieved by developing alternative designs was very limited, and the structural design of the parts was sufficiently streamlined, and the cost reduction of re-optimizing the design was very limited. But from the perspective of the purchasing department, there are no more options, and no more bargaining chips for business negotiations.

When the SWAT team discovered such problems and opportunities for improvement, SWAT did not care whether it was a design cost reduction or a business cost reduction. SWAT knows that as long as alternatives are developed, there is an opportunity to optimize costs. Therefore, within two months, SWAT conducted a series of experiments and developed alternatives. After that, SWAT began to switch part of the original supplier’s order volume. Although the switch did not reach 10% of the total amount, at this time, the supplier began to take the initiative to find SWAT to reduce the price and offered a very competitive price. SWAT achieved its goal through “business + technology”, a combination of punches. After the SWAT team broke through the boundaries of functions by focusing on the goal in this way, there were many similar breakthroughs.

Stimulate self-driving energy
SWAT is an empowering team. It needs to stimulate the self-driving energy of the front-line team and work hard around the goal autonomously and spontaneously. The key to stimulating energy is trust and full authorization, so that the empowering team can take control of its own destiny, assume its own responsibilities, and be self-organized, self-driven, and self-management.

In this innovation of Autoliv’s organization and management, the SWAT team leader has the deepest impression of “full authorization”: In the past, various trainings inside and outside the company often used such a sentence to motivate employees-“If you are a company Boss, what should you do and what should you do”, but “if” is just “if” after all. For the operation of the SWAT Team, the company’s senior management team really gave the authority to the SWAT leader. The SWAT leader defines who the team recruits, how the team operates, the definition of job responsibilities, and what projects to do.

For example, the team only defined products, processes, and procurement in the initial stage. During the operation process, based on the needs of the SWAT leader, the quality role was added, which greatly promoted the implementation of some project results, including the next upgrade of SWAT: current We continue to work in the correct direction that has been verified. At the same time, to consider more possibilities in the future, it is also the first to let the team propose a plan by itself.

Break the shackles of traditional KPIs
In the way of performance management, Autoliv also broke the traditional shackles of KPI. The Innovation SWAT project does not have a KPI in the strict sense, and all goals and tasks are designed and implemented by the two teams. Innovation is difficult to measure. If the final goal is determined with a rigid number, it may be a restriction in itself. The company only defines overall goals, detailed goals and key results, and specific goals are discussed by team members and defined by themselves (Figure 2).

Figure 2 Multi-functional talents and network organization management methods

At first, some people worried that if the goals were defined by themselves, would they be set too low, which is equivalent to taking their own exams and writing the exam papers by themselves, but after the real operation, this worrying situation did not happen. When the team members defined themselves after discussion Refine goals and strategic paths. When they have decision-making power, team members are more engaged and show stronger self-drive. Moreover, with the progress of some projects, when the team members see the opportunity to achieve better results, they will take the initiative to adjust the promotion goals.

Self-determination of goals avoids the traditional function-based decomposing of goals. It is to encourage our employees to break through the limitations of functions. As long as they contribute to business growth, they can do and should do all, regardless of functional authority. , And there will be no gray areas of responsibilities. SWAT can do what others are unwilling to do or cannot do, as long as it helps to achieve the goal. In the breakthrough of multiple projects, business, technology, quality, etc. are often integrated, and problems are solved around goals, rather than functions.

Under the condition that the empowerment team is fully authorized, self-managed and operated independently, the ability of team members has become a key factor for the effective operation of the empowerment team. Under the traditional bureaucratic organization, front-line employees are the screws, and execution is the key. In an enabling agile organization, everyone is a leader and CEO, and assumes leadership responsibilities for the projects and tasks they are responsible for. This requires a more comprehensive ability and a spirit of taking responsibility. Strategic thinking, business ability, innovation ability, iterative ability, adult thinking, these are traditionally the abilities possessed by the leaders of the leadership echelon, and have become the ability requirements of front-line employees. Enabling agile organizations puts forward higher requirements for the development of talents.

In terms of the establishment of the Autoliv SWAT team and the selection of personnel, it is more inclined to choose T-shaped or Π-shaped talents, that is, multi-functional talents, or those who have the potential to grow into multi-functional talents. To use a vivid metaphor, it is to select special forces, with multiple arms combat capabilities.

The main reasons for this are: first, understanding different professional knowledge and being able to grasp the key points of the partner in communication and cooperation, thereby improving the efficiency of cooperation and communication; second, reducing the resources required for comprehensive tasks. For example, for some projects, we need four functions. Traditional teams need at least four people. However, in SWAT Team, we probably only need to arrange one or two people. Solve and think about problems. A multifunctional talent is like a person who has multiple tools and multiple thinking models in his hands, so that he can think more flexibly and comprehensively in problem solving.

Figure 3 A multi-functional cross-border network organization

Based on this multi-ability, SWAT assigns tasks according to workload, personal aptitude, and willingness. The project system is usually used to operate. When determining some project leaders, the method of “self-recommendation + recommendation” is adopted, and there is no fixed full-time role. For example, in Project A, Zhang San is the project leader. In Project B, he may be someone else’s team member. There is no special person responsible for project management, no full-time procurement, and no full-time craftsmanship. This way, the deployment of resources becomes flexible and efficient. A networked organization and management method has been formed, and the more exploratory projects, the more elements involved, and the projects with complex environments, the easier it is to derive the results of this network management method.

For example, when optimizing the cost of products, SWAT has both design improvements, processes, and primary and secondary supply chain factors. No one knows the best method to use, and needs to explore and adjust the method. At this time, the advantages of this networked organization and management method are more obvious (Figure 3).

SWAT drives organizations to achieve agile evolution
The role of the empowering team is to introduce the mixed culture into the orderly organization, thereby driving the overall organization to change and grow into an empowering agile mixed ordering organization. Therefore, the empowerment team is not a special zone in the organization, but should be organically integrated into the organization, exert leverage, and drive the overall transformation of the organization.

The operation of Autoliv SWAT team does not adopt a top-down design idea, but gives the team a certain space, allowing the team to make iterative adjustments through self-organization and self-adaptation, thereby shaping a biological evolutionary organization.

At first, SWAT was like a small company with all the functions. The first attempt was to go it alone, that is, to open up a second battlefield and operate independently. From product conceptual design, verification, application, and customer promotion, it is all done by ourselves. The effect is obvious, and the early development verification is very fast. However, with the advancement of operations, it is found that the promotion and application efficiency is not high, which is mainly manifested in two aspects:

One is the limitation of resources. With the increase in the number of projects, the company found that if the program, development, verification and application of results are all done by SWAT, the required resources are at least three to five times the current amount.

The second is the unreasonable input and output. The initial investment cost of developing a material and developing a supplier is fixed, and the cost is the same for 2 customers and 20 customers. Then if you only start the application one by one customer instead of comprehensively promote it, then The input-output ratio is not efficient enough.

Therefore, after trying to operate independently for a period of time, the SWAT team turned to cooperation with traditional functional departments. SWAT exported the verification results to various functional departments and applied them to mass production supporting projects. In this way, SWAT took the agility of small companies. , Combined with the scale effect of large enterprises.

However, with the advancement of such operations, another problem has emerged. SWAT has overlapping functions with traditional functional departments. For example, while SWAT is developing competitive suppliers, the purchasing department is also developing it. When SWAT presents the successful results and exports them to various functional departments for application, the two sides have different views, which also affects the efficiency of the application of results. .

With the support of the high-level team in China, SWAT continued to explore the causes of the problem. In the end, the problem was summarized and summarized. In fact, there were two aspects: insufficient mutual trust and different perspectives.

As a result, SWAT has explored a better way of cooperation: full-process collaboration. Instead of waiting for the completion of the preliminary development and verification to export to the traditional functional departments, but in the initial concept stage, the traditional functional department interface people are invited to participate in it. Let the functional departments understand the background and process of the research, the problems and solutions they face from the beginning, so as to establish deeper mutual trust and unify the goals, so that the later application becomes much smoother.

Functional departments also tasted the sweetness in their cooperation and realized the advantages of SWAT’s agile and iterative innovation model. When multiple functions require close cooperation, and the project progress is not fast enough, many functional departments will take the initiative to find the SWAT team for support.

The SWAT team is like a catfish, driving Autoliv’s agile evolution. From the rejection, loss and pain of traditional functional departments at the beginning, to the positive thinking and follow-up in the later period. The formation of “Why can’t we do what SWAT can do” thinking has led to the transformation of the entire organizational culture.

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Review the formation process of the operation mode, from independent operation to cooperation with traditional departments, from phased cooperation, and then to the harmonious cooperation. The formation process of the entire operation mode is not thought out at the beginning, but is designed from top to bottom. An operation method that comes out is that the organization evolves through self-iteration, exploration, and self-growth, so that SWAT and the main structure of the company have both skeletal and flesh-and-blood connections.